Which Is Better, Writing off Your Capital Expense for Servers or Using the Services from the Cloud?

rsz_219152621_sThere are several instances when a business will have to consider choosing between an in house server and cloud services. Some of the common instances when such considerations come into play may include:

•    When the business has outgrown the current server.
•    When the current server is out dated and is not able to support the business as it is supposed to.
•    When launching a new business.

In-house servers

Small and medium sized businesses did not consider cloud services in the past and mainly used in-house servers for file sharing, emailing, hosting applications and conducting other office related activities. However with the developments in technology small and medium businesses now have the option of using cloud services.

When using an in-house server the business has full control over the server and can design the server to meet their needs. It is therefore easy for the business to upgrade the server whenever the need arises and the business has the freedom to choose the applications and operating system installed on the server.

However the business will require a large capital investment to have an in-house server installed and running. The cost of assembling the server will vary depending on the needs of the business. And small and medium businesses may not have the finances to install or upgrade an in-house server. The business will also incur extra costs to hire an IT professional to regularly maintain and service the server.

Cloud servers

Cloud services just like in-house servers have their positives and little drawbacks. A business that has a large number of virtual workers or has IT costs that are high should consider a cloud server as it will save them on costs. Using a cloud server will also relieve the business from the stress of server management; this makes the cloud server ideal if the business does not have the resources to pay in-house IT professionals. Cloud servers are also easy to upgrade depending on the business needs as there are no costs incurred to buy new software. It is also very fast to download resources to a cloud server as compared to uploading and installing new resources to an in-house server.

The main drawback a business may experience from cloud servers is the lack of dependable internet connection. A stable connection is vital to connecting to cloud servers unstable internet will only lead to frequent disconnections from the server.  The business should also evaluate their ability to pay the monthly hosting charges which if overlooked may lead to disconnection from the server. Cloud servers are known to be highly secure, but businesses need to be aware that using cloud servers may mean a loss of data control. Thus, it needs to be considered in their business decisions. Further, businesses need to look at both servers before they make a decision.

Break down of cloud servers against in-house servers

In-house servers Cloud servers
Has high maintenance cost including IT support Require very strong internet connection
Set up costs are very high Hosting fees are high
Full control on data Loss of data control

Businesses also need to consider the taxation aspect of each server type. Because in-house servers are physical and require the regular purchase of software and parts, taxation will be spread over a number of years. On the other hand, cloud services are instantly deductible since the business is not involved in software updates — as that is left to the hosting firm.

Ultimately, the decision to work with an in-house server or a cloud server fully depends on the business’s budget and needs. However, if you want to take your business to new heights, you may only be able to do so with a cloud server. The cloud is the future of how business will be done. MCORE Inc. and its full portfolio of cloud services can take your business to the future, starting today!